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Looking for General Mortgage Help

Anonymous
Not applicable

Looking for General Mortgage Help

Hi, I'm 24yrs old looking to buy a house in the Cincinnati area. I've talked to some loan brokers and my mid score seems to be about 623 at the moment. I've recently paid off all of my credit card debt, the brokers say that should raise my score to at least 640 to get me into a better rate. 

My questions are: 
1. What are the current rates looking like for the scores I provided?

2. What is the percentage of income my mortgage payment should NOT exceed after PMI, Taxes, and Insurance?

 

3. Is FHA the better option over a conventional loan? I'm not sure the requirements for a Conventional 97, Or a low down payment on a regular conventional loan.

 

Thanks!

8 REPLIES 8
kc0039
Established Contributor

Re: Looking for General Mortgage Help


wrote:

Hi, I'm 24yrs old looking to buy a house in the Cincinnati area. I've talked to some loan brokers and my mid score seems to be about 623 at the moment. I've recently paid off all of my credit card debt, the brokers say that should raise my score to at least 640 to get me into a better rate. 

My questions are: 
1. What are the current rates looking like for the scores I provided?

623 - 4.625% - 4.875% (depends on the lender and compensation)

640 - 4.5% - 4.75% (same reason as above)

2. What is the percentage of income my mortgage payment should NOT exceed after PMI, Taxes, and Insurance?

36% from gross income (general rule of thumb since housing prices are higher)

 

3. Is FHA the better option over a conventional loan? I'm not sure the requirements for a Conventional 97, Or a low down payment on a regular conventional loan.

With your scores yes. If you're at 680 or better, that's where things get iffy with conventional and FHA 

 

Thanks!


 

Licensed in IL
Message 2 of 9
Anonymous
Not applicable

Re: Looking for General Mortgage Help


wrote:

wrote:

Hi, I'm 24yrs old looking to buy a house in the Cincinnati area. I've talked to some loan brokers and my mid score seems to be about 623 at the moment. I've recently paid off all of my credit card debt, the brokers say that should raise my score to at least 640 to get me into a better rate. 

My questions are: 
1. What are the current rates looking like for the scores I provided?

623 - 4.625% - 4.875% (depends on the lender and compensation)

640 - 4.5% - 4.75% (same reason as above)

2. What is the percentage of income my mortgage payment should NOT exceed after PMI, Taxes, and Insurance?

36% from gross income (general rule of thumb since housing prices are higher)

 

3. Is FHA the better option over a conventional loan? I'm not sure the requirements for a Conventional 97, Or a low down payment on a regular conventional loan.

With your scores yes. If you're at 680 or better, that's where things get iffy with conventional and FHA 

 

Thanks!


 


Thank you so much! Those rates you gave, are those for FHA? I've been hearing 5 - 5.5% from coworkers and it's been worrying me a bit.

Message 3 of 9
kc0039
Established Contributor

Re: Looking for General Mortgage Help

Those are FHA rates. That's with a $200,000 purchase price and 3.5% down

Licensed in IL
Message 4 of 9
Anonymous
Not applicable

Re: Looking for General Mortgage Help


wrote:

Those are FHA rates. That's with a $200,000 purchase price and 3.5% down


This makes me feel a lot better about becoming a home owner. Usually when I hear those numbers there's a disclaimer that those rates are with an assumed score of 740. Thanks again.

Message 5 of 9
kc0039
Established Contributor

Re: Looking for General Mortgage Help

Those are my rates anyway. I don't know about your lenders in Cinci. Remember, the lower the purchase price, the higher the rate as well. It all depends on your overall credit profile on what kind of rate you get. Also, rates fluctuate a lot nowadays. You never know if your rate 2 months down the road might be in the 5% range.

Licensed in IL
Message 6 of 9
Anonymous
Not applicable

Re: Looking for General Mortgage Help

 


wrote:

Those are my rates anyway. I don't know about your lenders in Cinci. Remember, the lower the purchase price, the higher the rate as well. It all depends on your overall credit profile on what kind of rate you get. Also, rates fluctuate a lot nowadays. You never know if your rate 2 months down the road might be in the 5% range.


Ah okay, I'm looking in the 120k - 130k range. I have one deliquent account, great payment history, less than 5% of Credit Utilization and a DTI of about 11% So i'm hoping I can get close to those rates.

Message 7 of 9
kc0039
Established Contributor

Re: Looking for General Mortgage Help

They're at 4.5% - 4.75% at 623 credit score for a $120,000 home

Licensed in IL
Message 8 of 9
Anonymous
Not applicable

Re: Looking for General Mortgage Help

 


wrote:

They're at 4.5% - 4.75% at 623 credit score for a $120,000 home


Oh nice! Then they should drop even lower once my cards report and my score bumps upto the 640 range! Woo!

Message 9 of 9
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